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Your home is one of the greatest investments you’ll make in life. The idea of something happening to it is one of the worst images you can have as a homeowner. You can protect your property from damage or even break-ins, but identity thieves can threaten your ownership.
Title fraud can leave you out tens or even hundreds of thousands of dollars. Depending on what the fraudster is after, you could lose your equity, or even your home.
FCT is committed to protecting homeowners by catching fraud before it happens, providing education on fraud prevention, and stepping in to prevent losses if a scam succeeds.
A quick breakdown of title fraud
Title fraud starts with stealing a homeowner’s identity, then follows one of two main paths:
Purchase title fraud
- Someone impersonates a homeowner to sell their property.
- To the innocent buyer, it looks like a regular home sale. The “seller” often has property access as a tenant or AirBnB guest and can show buyers around.
- The fraudster disappears after a quick sale, usually for below market value.
- The homeowner often learns about the fraud when the buyer attempts to move in.
What happens next can vary, but the homeowner and buyer could end up in a legal battle to determine who legitimately owns the property.
Mortgage title fraud
- Someone impersonates a homeowner to take out a mortgage on their property.
- To the lender, it just looks like the homeowner wants to refinance or take out some home equity.
- The fraudster walks away with the money, sometimes making a few payments on the new mortgage to cover their tracks.
- The homeowner often learns about the fraud when the fraudulent mortgage goes into delinquency and the lender starts to take action.
Title fraud fact: Did you know that seniors are especially vulnerable to title fraud?
If you’re the homeowner, you can’t sell your property or take any equity out of it until your title is restored. This usually means tens of thousands in fees.
An underwriter at FCT recently caught an attempted mortgage title fraud in a town near Calgary. After spotting an issue with one piece of ID in a routine refinance deal, she flagged it with the team’s Certified Fraud Examiner (CFE), who investigated and confirmed the fraud. Someone was pretending to be the homeowner and taking $400,000 out of the property. We put a stop to that deal.
How is FCT protecting homeowners?
To FCT, being protected means having peace of mind. Here are just some of the ways we’re making sure homeowners have that:
Watching deals
Our underwriting team identified $350 million in suspicious transactions in 2022, from residential deals alone. The team monitors for the red flags we’ve identified over three decades of experience, and prevent hundreds of millions in losses every year.
Educating others
We aren’t the only ones working to protect consumers. Lending and legal professionals across Canada are stepping up to educate themselves about title fraud and how to help prevent it. We provide free seminars, articles and videos to both professionals and the public—the more everyone knows about title fraud, the harder it gets for the fraudsters.
Taking responsibility
When FCT looks at a deal, it’s because a lender, legal professional, or homebuyer wanted to protect it with title insurance. That protection means that the buck stops with us. If we don’t catch a fraudulent deal before it goes through, we’re the ones who pay for it, not you.
Beyond the coverage, every policy we issue carries a duty to defend. That means if there’s a possible fraud, we step in to navigate the process on your behalf. We take on the work and costs it takes to make you whole, hiring investigators, retaining counsel and even going to court so that you don’t have to.
The threat of fraud is on the rise, but you don’t have to face it alone. Learn more about title fraud by following the links in this article, and if you don’t have title insurance yet, get protected now. It takes minutes to do, and lasts for as long as you own your home.
Insurance by FCT Insurance Company Ltd. Services by First Canadian Title Company Limited. The services company does not provide insurance products. This material is intended to provide general information only. For specific coverage and exclusions, refer to the applicable policy. Copies are available upon request. Some products/services may vary by province. Prices and products/services offered are subject to change without notice.
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